Apple Inc.v.ContentGuard Holdings, Inc.

Patent Trial and Appeal Board

Jun 26, 2015

10956070 (P.T.A.B. Jun. 26, 2015)

Trials@uspto.gov Paper 9
571-272-7822 Date: June 26, 2015

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

APPLE, INC.,
Petitioner,

v.

CONTENTGUARD HOLDINGS, INC.,
Patent Owner.

Case IPR2015-00355
Patent 8,001,053 B2

Before KARL D. EASTHOM, GLENN J. PERRY, and
MICHAEL J. FITZPATRICK, Administrative Patent Judges.

PERRY, Administrative Patent Judge.

DECISION
Denying Institution of Inter Partes Review
35 U.S.C. § 314(a) and 37 C.F.R. § 42.108

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I. INTRODUCTION
Petitioner, Apple, Inc., filed a Petition to institute an inter partes review of
claims 1–5, 8, 9, 15–19, 22, 23, 26–30, 33 and 34 (the “challenged claims”) of U.S.
Patent No. 8,001,053 B2 (Ex. 1005, the “’053 patent”). Paper 1, “Pet.” Apple’s
challenges are brought under 35 U.S.C. § 103(a). Patent Owner, ContentGuard
Holdings, Inc., filed a Preliminary Response pursuant to 35 U.S.C. § 313. Paper 8,
“Prelim. Resp.”
We have authority to determine whether to institute an inter partes review.
35 U.S.C. § 314(b); 37 C.F.R. § 42.4(a). We deny the Petition.
A. The Asserted Grounds
Petitioner identifies the following as asserted grounds of unpatentability:
References Basis Claims Challenged
Ireton (Ex. 1010)
1
§ 103(a)
2
1–5, 8, 9, 15–19, 22, 23,
26–30, 33 and 34
Ireton (Ex. 1010) and
England (Ex. 1009)
3

§ 103(a) 1–5, 8, 9, 15–19, 22, 23,
26–30, 33 and 34
Ireton and Gruse
(Ex. 1008)
4

§ 103(a) 1–5, 8, 9, 15–19, 22, 23,
26–30, 33 and 34

Pet. 3
5
.

1
U.S. Patent Publication 2002/0077984 A1 (June 20, 2002) (filed Dec. 19, 2000)
2
The America Invents Act (“AIA”), Pub.L. No. 112-29, took effect on March 18,
2013. Because the application from which the ’053 patent issued was filed before
that date, our citations to Title 35 are to its pre-AIA version.
3
U.S. Patent No. 6,327,652 B1 (Dec. 4, 2001) (filed Jan. 8, 1999).
4
U.S. Patent No. 6,389,538 B1 (May 14, 2002).
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II. THE ’053 PATENT
A. The Invention
The ’053 patent generally relates to systems and methods for digital rights
management (“DRM”). Ex. 1005, 1:20–23, 1:48. The ’053 patent addresses the
problem of downstream distribution by providing “meta-rights” which have the
ability to spawn other user rights. Id. at 2:66–3:10. Figure 9 of the ’053 patent is
reproduced below.

5
The challenge based on Ireton alone is not listed on page 3 of the Petition, but is
argued beginning at page 21.
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Figure 9 is block diagram of a DRM system 10 that enforces usage rights and
meta-rights for specific content and services. Id. at 2:15–18. A user activation
component (server 20) issues public and private key pairs, or other identification
mechanisms, to content users. Software, installed in a client 30 associated with the
content recipient, enforces usage rights for protected content. Client component 60
contains public and private keys issued by activation server 20. Id. at 4:20–35.
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Rights label 40, associated with content 42, specifies usage rights and meta-
rights that are available to a recipient, i.e. a consumer of rights, when
corresponding conditions are satisfied. License Server 50 manages the encryption
keys and issues licenses 52 for protected content 42. Licenses 52 embody data
representing a granting of rights, including usage rights and meta-rights, to an end
user.
6
Client component 60 interprets and enforces the rights, including usage
rights and meta-rights, as specified in the license. Id. at 4:36–51.
B. The Challenged Claims
The challenged claims are 1–5, 8, 9, 15–19, 22, 23, 26–30, 33 and 34.
Pet. 3. Claims 1, 15, and 26 are independent. Claim 1 is illustrative and
reproduced below:
1. A method for sharing rights adapted to be associated with
an item, the method comprising:
specifying, in a first license, using a processor, at least one
usage right and at least one meta-right for the item, wherein the usage
right and the meta-right include at least one right that is shared among
one or more users or devices;
defining, via the at least one usage right, using a processor, a
manner of use selected from a plurality of permitted manners of use
for the item;
defining, via the at least one meta-right, using a processor, a
manner of rights creation for the item, wherein said at least one meta-

6
For example, rights offer 40 may permit a user to view content for a fee of five
dollars and print content for a fee of ten dollars, or it may permit a user to offer
rights to another user, for example, by utilizing the concept of meta-rights. Ex.
1005, 4:43–46.
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right is enforceable by a repository and allows said one or more users
or devices to create new rights;
associating, using a processor, at least one state variable with
the at least one right in the first license, wherein the at least one state
variable identifies a location where a state of rights is tracked;
generating, in a second license, using a processor, one or more
rights based on the meta-right in the first license, wherein the one or
more rights in the second license includes at least one right that is
shared among one or more users or devices; and
associating at least one state variable with the at least one right
that is shared in the second license, wherein the at least one state
variable that is associated with the second license is based on the at
least one state variable that is associated with the first license.
III. ANALYSIS
A. Failure to Identify Related Matters
A petition for an inter partes review “may be considered only if,” among
other things, “the petition provides such other information as the Director may
require by regulation.” 35 U.S.C. § 312(a)(4). In that regard, the Director requires
a petitioner to include certain mandatory notices with its petition. 37 C.F.R.
§ 42.8(a)(1). The mandatory notices include a requirement to “[i]dentify any other
judicial or administrative matter that would affect, or be affected by, a decision in
the proceeding.” 37 C.F.R. § 42.8(b)(2) (titled “Related matters”). “Judicial
matters include actions involving the patent in federal court. Administrative
matters include every application and patent claiming, or which may claim, the
benefit of the priority of the filing date of the party’s involved patent or application
as well as any ex parte and inter partes reexaminations for an involved patent.”
Office Patent Trial Practice Guide, 77 Fed. Reg. 48,756, 48,760 (Aug. 14, 2012).
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Pursuant to 37 C.F.R. § 42.8(b)(2), Petitioner identifies only the following
related matters: ContentGuard Holdings, Inc. v. Amazon.com, Inc., Case No. 2:13-
cv-01112 (E.D. Tex.) (the “Texas lawsuit against Apple”); Cases IPR2015-00356,
-00357, and -00358 (involving the ’053 patent); and Cases IPR2015-00351,
-00352, -00353, and -00354 (involving related U.S. Patent No. 7,774,280 B2 (“the
’280 patent”)). Pet. 1–2.
According to Patent Owner, however, there are numerous additional related
matters: Google Inc. v. ContentGuard Holdings, Inc., Case No. 14-cv-0498 (N.D.
Cal.) (the “California lawsuit”); ContentGuard Holdings, Inc. v. Google Inc., Case
No. 14-cv-0061 (E.D. Tex.) (the “Texas lawsuit against Google”); pending U.S.
Patent Application No. 13/162,826 (the “’826 application”), which is a
continuation of the application from which the ’053 patent issued; Case CBM2015-
00040 (involving the ’280 patent); and Case CBM2015-00043 (involving’053
patent).
7
Paper 7, 1–2.
Patent Owner is correct that the California lawsuit is a related matter, as it
involves a declaratory judgment action for non-infringement of the ’053 patent.
Ex. 3001 ¶¶ 48–55. The Texas lawsuit against Google also is a related matter, as it
involves an assertion of infringement of the ’053 patent. Ex. 3002 ¶¶ 44–45.
Thus, Petitioner should have identified both of those lawsuits in order to have its
Petition considered. 35 U.S.C. § 312(a)(4); 37 C.F.R. § 42.8(b)(2). Although it is

7
The petition in CBM2015-00043 was filed December 11, 2014, and, thus, did not
exist when the instant Petition was filed on December 10, 2014. The petition in
CBM2015-00040 was filed December 9, 2014, and, thus, we would not presume
Petitioner was aware of it when it filed its Petition the next day.
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possible that Petitioner was not aware of the California lawsuit, it was informed of
the Texas lawsuit against Google. See Ex. 3003 (Order denying Patent Owner’s
motion for consolidation of the Texas lawsuits, said order entered in the Texas
lawsuit against Apple).
Patent Owner is also correct that the ’826 application is a related matter.
The ’826 application was published on October 6, 2011, and it is listed in the child
continuity data field in the Public PAIR search report of the ’053 patent. Thus,
Petitioner should have been aware of it and identified it in the Petition.
Additionally, Petitioner’s Declarant, Atul Prakash, Ph.D., cites several
PTAB decisions involving patents belonging to Patent Owner, as affecting the
construction of claims of the ’053 patent. See Ex. 1003 ¶ 284 (citing ZTE Corp. v.
ContentGuard Holdings Inc., Case IPR2013-00139, Paper 57 (PTAB June 26,
2014); ZTE Corp. v. ContentGuard Holdings Inc., Case IPR2013-00133, Paper 61
(PTAB July 1, 2014); ZTE Corp. v. ContentGuard Holdings Inc., Case IPR2013-
00138, Paper 57 (PTAB July 1, 2014)); see also Ex. 1003 ¶ 285 (citing ZTE Corp.
v. ContentGuard Holdings Inc., Case IPR2013-00133, Paper 15 (PTAB July 1,
2013)). Yet, the Petition does not identify, as related matters, the inter partes
reviews in which those decisions were rendered. Pet. 2.
The Petition’s failure to comply with 37 C.F.R. § 42.8(b)(2), and thus also
35 U.S.C. § 312(a)(4), could be grounds for denial of the Petition. 35 U.S.C. §
312(a)(4); cf. Reflectix, Inc., v. Promethian Insulation Tech. LLC, 2015 WL
1927414, *9 (PTAB Apr. 24, 2015) (denying institution because petition did not
comply with parallel requirement, under 35 U.S.C. § 312(a)(4), to identify all real
parties-in-interest). It is unnecessary to determine whether to deny the Petition on
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that basis, however, because the Petition is denied for additional reasons, as
explained below.
B. No Reasonable Likelihood of Prevailing
A petition must show how the challenged claims are unpatentable under the
statutory grounds it identifies. 37 C.F.R. § 42.104(b)(4). All of Petitioner’s
grounds of unpatentability challenge the claims as obvious in violation of
35 U.S.C. § 103(a).
A patent claim is unpatentable under 35 U.S.C. § 103(a) if the differences
between the claimed subject matter and the prior art are such that the subject
matter, as a whole, would have been obvious at the time the invention was made to
a person having ordinary skill in the art to which said subject matter pertains. KSR
Int’l Co. v. Teleflex Inc., 550 U.S. 398, 406 (2007). The question of obviousness is
resolved on the basis of underlying factual determinations, including: (1) the scope
and content of the prior art, (2) any differences between the claimed subject matter
and the prior art, (3) the level of skill in the art, and (4) where in evidence, so-
called secondary considerations. Graham v. John Deere Co., 383 U.S. 1, 17–18
(1966).
There is not a reasonable likelihood that Petitioner would prevail in showing
the subject matter of any of the challenged claims is obvious over any of the
grounds identified in the Petition.
First, the Petition does not identify sufficiently the differences between the
claimed invention and the prior art, or how the prior art teachings are to be
modified or combined, if at all. Pet. 40–57; see Graham, 383 U.S. at 17–18
(obviousness inquiry is based on factual inquiries including the difference between
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the claimed invention and the prior art). Indeed, it is difficult to understand the
distinctions (if any) between the asserted grounds, because they are lumped
together. Pet. 40–57. For example, the Petition states the following:
To the person of ordinary skill, Ireton, by itself or in view
of other prior art, suggests a range of possible
implementations of its scheme, particularly in view of the
knowledge and experience the person of skill would have
possessed in 2001 or before. As a consequence, Ireton,
alone or with other prior art, would have rendered
obvious variations of the processes, systems and devices
it expressly describes, including variations such as the
following: (i) particular data constructs and system
configurations not explicitly described in Ireton but
which have same or comparable functionality to
components or elements described in Ireton, including
those reflecting conventional design or implementation
choices; (ii) storing data elements used in Ireton
corresponding to “usage rights” and “meta rights” in the
’053 patent in the same or difference data constructs
(e.g., “licenses”); (iii) system components with varying
security capabilities, including those capable of
functioning as “trusted systems”; (iv) implementing
functionality of Ireton in an integrated (e.g., single
logical or actual computer system) or in a distributed
(e.g., using components that communicate over
networks) manner, such as using a remote server to track
shared rights; or (v) a scheme wherein a “plurality” of
state variables being used.
Each of these types of variations would have been
considered obvious design or implementation choices
based on the guidance in Ireton in view of what would
have been known to the person of ordinary skill and other
prior art, e.g., Ireton alone, or when considered in view of
either England (Ex. 1009) or Gruse (Ex. 1008).
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Pet. 40–41 (underlining of references omitted).
8

The Petition also lacks an articulated or apparent reason supported by “some
rationale underpinning” to modify/combine the purportedly known elements in the
fashion claimed by the ’053 patent. See KSR, 550 U.S. at 418 (quoting In re Kahn,
441 F.3d 977, 988 (Fed. Cir. 2006)). Instead, and as demonstrated in the block
quote above, Petitioner leaves it to the Board to ascertain what gaps to fill, and
then presents vague statements regarding what the prior art suggests, referring to “a
range of possible implementations,” “obvious variations,” and “obvious design or
implementation choices.” Pet. 40–41.
A reason to modify/combine the prior art is not the only thing not apparent
from the Petition. Also not apparent is any particular modification/combination of
the prior art, let alone how such modification/combination would have rendered
obvious any of the challenged claims. Indeed, the Petition lacks a meaningful, if
any, discussion showing how the prior art renders obvious any particular claim
being challenged.
Throughout the Petition, Petitioner makes sweeping statements that Ireton’s
functionality is equivalent to that of a particular claimed feature. Typically such
statements are accompanied by citations to multiple paragraphs of the Declaration

8
The Petition does not identify the differences between Ireton and the claimed
inventions. Yet, the Petition also does not show that there are no differences. The
Petition fails to show, let alone assert, anticipation at least because the Petition
does not show that Ireton discloses all the limitations of the challenged claims, as
arranged in the challenged claims. See Net MoneyIN, Inc. v. VeriSign, Inc., 545
F.3d 1359, 1370 (Fed. Cir. 2008) (holding that an anticipatory reference must show
all limitations arranged or combined in the same way as recited in the claims).
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of Dr. Prakash (Ex. 1003)
9
. Those paragraphs in the Prakash declaration simply
state the same sweeping equivalence without explanation. For example, the
Petition states the following:
Moreover, persons of ordinary skill in the art could
implement these concepts as functional systems for
distributing digital content based on the guidance in
Ireton using only conventional programming and design
skills. Ex. 1003 at ¶¶ 157-87.
A person of ordinary skill in the art could easily have
implemented a wide variety of DRM schemes for
transferring and sharing rights based on these admittedly
known core concepts and functionalities, and in view of
the guidance provided in Ireton. Ex. 1003 at ¶¶ 700-736.
Pet. 41–42.
In connection with Petitioner’s sweeping statements about equivalent
functionality, Petitioner readily admits that “data construct[s]” required by the
claims are not explicitly described by Ireton. For example: “Ireton does not
explicitly describe the features of a data construct used by a processor to convey
the right to create and distribute digital content among the components of the
disclosed system.” Pet. 26. Petitioner excuses this absence by saying “the use of
such data constructs was well-known and would have been obvious to use to
implement the Ireton scheme.” Id. (citing Ex. 1003 ¶¶ 669–674, 714–725).
There are many DRM solutions involving many different “constructs.” The
particular constructs are important in distinguishing the various DRM solutions.

9
The Prakash Declaration (Ex. 1003) has 354 pages including 1003 enumerated
paragraphs.
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Yet, Petitioner leaves it to us to comb through numerous paragraphs of an expert
declaration to figure out how to fashion the various constructs and apply them to
Ireton in order to meet the claim limitations.
The Prakash Declaration is not helpful. In paragraph 926, Dr. Prakash cites,
as evidence, to over 100 other paragraphs of his own Declaration. Ex. 1003 ¶ 926
(“As I explained above, the core concepts of claims 1, 15, and 26 were all well-
known to persons of ordinary skill in the art. See supra ¶¶ 129-154 (usage rights),
156-185 (meta-rights), 188-210 (state variables), 211-231 (sharing) . . . The
claims do not include any new concepts or novel ideas. See supra ¶¶ 819-
824.”). Board rules require specific evidentiary citations. 37 C.F.R.
§ 42.104(b)(5). Board rules also prohibit incorporation by reference, such as
incorporating over 100 paragraphs of a declaration into a petition. 37 C.F.R.
§ 42.6(a)(3).
Dr. Prakash discusses Ireton in paragraphs 661–713 of his declaration,
which are filled with conclusory statements that one of ordinary skill would have
known how to implement a particular claim feature of the ’053 patent based on
Ireton. For example, paragraph 707 states:
A person of ordinary skill in the art also would
have recognized the Ireton scheme could and should be
implemented using a variety of “trusted systems”
designs. In 2001, trusted systems were well known and
had been used to implement DRM systems. Technologies
and components to implement “trusted systems” with
varying degrees of security were also well known before
2001. Ex. 1001 (‘280 patent) at 1:24-2:48.
Ex. 1003 ¶707. However, it is devoid of reasoning that identifies any particular
difference between a particular claimed feature and a particular disclosure of
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Ireton, followed by an explanation as to how and why one of ordinary skill would
have modified the particular feature of Ireton to bring it within the claim.
A petition must show how the challenged claims are unpatentable under the
statutory ground(s) it identifies. 37 C.F.R. § 42.104(b)(4). The instant Petition
does not do this, and there is not a reasonable likelihood that Petitioner would
prevail with respect to any of the challenged claims on any of the challenged
grounds. See 35 U.S.C. § 314(a).
C. Ireton in Combination
Apple contends that claims 1–5, 8, 9, 15–19, 22, 23, 26–30, 33 and 34 are
unpatentable under 35 U.S.C. § 103(a) over the following combinations: (1) the
combination of Ireton and England; and (2) the combination of Ireton and Gruse.
Pet. 46–57. In each of these asserted grounds based on obviousness, Apple does
not apply the teachings of England or Gruse in such a way that remedies particular
deficiencies in Ireton. See generally id. Therefore, for essentially the same
reasons discussed above, Apple has not demonstrated a reasonable likelihood that
it will prevail on its assertion that claims 1–5, 8, 9, 15–19, 22, 23, 26–30, 33 and
34 would have been obvious over: (1) Ireton alone; (2) the combination of Ireton
and England; and (3) the combination of Ireton and Gruse.
D. Additional Considerations
The Director requires us to apply our trial rules “to secure the just, speedy,
and inexpensive resolution of every proceeding.” 37 C.F.R. § 42.1. No such
proceeding could be secured with the record presented to us by Petitioner.
Dr. Prakash’s Declaration is an omnibus declaration used by Petitioner in
eight separate Petitions, collectively challenging both the ’053 patent and the
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related ’280 patent with four sets of prior art each.
10
The declaration is 342 pages,
includes voluminous information not relevant to this Petition, and, as discussed
above, contains numerous self-citations.
The Petition includes sixty-one exhibits totaling 30,298 pages. See Exs.
1001–1061. Petitioner asserts that all exhibits are relied upon in the Petition. See
Pet., at “Attachment B” (subtitled “List of Evidence and Exhibits Relied Upon in
Petition”). Fifty-one of the exhibits, however, are not cited in the Petition.
11

Although some of those fifty-one exhibits are cited in Dr. Prakash’s Declaration,
several of them are not. Also, mere citation of an exhibit in Dr. Prakash’s
Declaration should not be equated with being relied upon in the Petition, because
the Declaration is being offered in seven other IPR petitions, each of which
challenges a different patent and/or asserts a different set of prior art.
The Office Patent Trial Practice Guide cautions that petitioners should
“avoid submitting a repository of all the information that a judge could possibly
consider, and instead focus on concise, well-organized, easy-to-follow arguments
supported by readily identifiable evidence of record.” 77 Fed. Reg. at 48,763. The
Petition widely misses that mark.
IV. CONCLUSION
The Petition fails to identify all known related matters and fails to show
there is a reasonable likelihood that Petitioner would prevail with respect to at least

10
Cases IPR2015-00351 through -00358.
11
Only Exhibits 1001, 1003, 1005, 1008, 1009, 1010, 1012, 1025, 1026, and 1035
are cited in the Petition.
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one of the claims challenged in the Petition. See 35 U.S.C. § 314(a); 37 C.F.R.
§ 42.8(b)(2).
Taking into account the arguments presented in the Preliminary Response,
we conclude that the information presented in the Petition does not establish that
there is a reasonable likelihood that Petitioner will prevail in challenging claims 1–
5, 8, 9, 15–19, 22, 23, 26–30, 33 and 34 of the ’053 patent as unpatentable under
35 U.S.C. § 103(a).
V. ORDER
Accordingly, it is
ORDERED that the Petition is denied and no trial is instituted.

For PETITIONER:
Jeffrey P. Kushan
Michael R. Franzinger
Sidley Austin LLP
iprnotices@sidley.com

For PATENT OWNER:
Timothy P. Maloney
Nicholas T. Peters
Fitch Even Tabin & Flannery LLP
tpmalo@fitcheven.com
ntpete@fitcheven.com

Robert A. Cote
McKool Smith, P.C.
rcote@mckoolsmith.com